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Long Term Contract For LNG In September

Syed Shukur Ali Shuvo

The government is to sign a long-term agreement with Qatar in September this year to import Liquefied Natural Gas (LNG) as the cabinet committee on public procurement has approved the pricing formula and draft contract document.

“As the cabinet committee approved the pricing formula yesterday, the government would sign a long-term contract for importing LNG from Qatar to meet growing energy demand in the country,” State Minister for Power, Energy and Mineral Resources Nasrul Hamid told today.

He said the government would import LNG from Qatar’s state-run firm-RasGas Company Limited (RasGas) under Government to Government (G to G) arrangements and the duration of the contract would be 15 years.

“Prime Minister Sheikh Hasina’s government has also undertaken various steps alongside increasing gas production to ensure energy security in the country. Process is underway to explore onshore and offshore gas,” Nasrul Hamid said.

He expected that the LNG will be brought from April next as Petrobangla signed a contract with US Company Excelerate Energy on July 18, 2016 for installing the Floating Storage and Re-gasification Unit (FSRU) for LNG service from its facilities to be built in 18 months.

According to the energy ministry, the Sales Purchase Agreement (SPA) for LNG import would be signed with Ras Laffan Company Liquefied Natural Gas Company Limited (3) and activities of the Contract Implementation and Operation would be completed RasGas LNG SPA, as its operating company.

The Petrobangla has an option to receive cargo after the agreement within a 90-day notice, as per the contract the government would have scope to import 1.8 million tonnes of LNG from one to five year programme plan on Base Annual Contract Quality (BACQ) basis.

Meanwhile, the government is to install FRSU at Maheskhali Island in Cox’s Bazar to facilitate the daily gas supply increase by 500 mmcf LNG from Qatar to meet the country’s growing demand, it said.

Qatar is one of the leading LNG exporting nations and Bangladesh has already signed MoU with the country for importing LNG to meet gas shortage and the RasGas would supply 500 mmcfd LNG per day, it said.

The Petrobangla signed a Confidential Agreement (CA) with the RasGas through different courses of discussion on LNG import. On April 20, 2017, Petrobangla signed a contract with Summit Corporation for LNG re-gasification service from its facilities to be built in 18 months, the statement said.

Now Petrobangla, the state-run oil, gas and mineral resources corporation, supplies approximately 2,750 million cubic feet of natural gas a day from domestic gas fields against a demand for at least 3,600 million cubic feet gas and the demand would be rose to 8,000 mmcfd in 2041, it said.

The RasGas is one of the world’s premier integrated LNG enterprises and has an enviable reputation for being a safe and reliable supplier of LNG that has transformed a regional resource into a key component of the global energy mix.